“This is the best time to buy a house.” If I’ve heard that once, I’ve heard it a thousand times but maybe there’s a reason why people keeping saying this. Let me introduce you to the newest loan program: The Georgia Dream Neighborhood Stabilization Program.
This program is strictly for buyers purchasing foreclosures to help reduce the number of foreclosures on the market. In a nut shell, this program gives you $14,000 to use for repairs to the home or for the down payment, and here’s the best part: You aren’t required to pay it back!
Ok so what’s the catch? Well, like all government programs there are a few details to be mindful of:
- This program is only eligible for home purchases, not refinances.
- This program is only eligible on foreclosures. The house must be owned by VA, HUD, Fannie Mae, Freddie Mac, or a non-profit organization.
- You don’t have to be a first-time homebuyer. This is great news for those of us that have been excluded by the First-Time Homebuyer $8,000 Tax Credit. However, if you do happen to be a first-time homebuyer, the news gets even better for you. You’re allowed to combine this loan program with the $8,000 tax credit. So you’re going to end up making out like a bandit with a total of $22,000 to your benefit.
- You must go through 8 hours of homebuyer education classes…It doesn’t matter if you’ve owned your own home for decades or if you’re a first-time homebuyer. It must be HUD approved and taken in a classroom, which means no online courses.
- The house must be used as your primary residence for 5 and a half years. Of course you can refinance in this time, but if you move before the 5 and half years are up or don’t use it as your primary residence the entire time, you will be required to pay back a portion of the $14,000. This will be calculated based on your length of time the home was used as your primary residence.
- There are income limits that vary by county. In addition, the program is only available in certain counties in Georgia.
- The property sales price must be 15 percent below the fair market value.
So why are there so many hoops to jump through? Like all good government programs, there are going to be checks and balances. Many would argue that the reason the housing bubble burst is because there were many misinformed buyers and under educated lenders. Requiring a homeowner to attend education courses insures that there will be no miscommunications or misunderstandings about the responsibility of homeownership.
On the other side, all lenders and loan officers are required to be certified and approved by the Department of Community Affairs to even do this loan. This insures that the people running the transactions know what they are doing.
Let’s get real…we’re talking about $14,000 free from the government. It’s going to take some time, but if your patient, it could pay off for you…and in a big way.
Tags: $14000, $8000 tax credit, Fannie Mae, Foreclosures, Freddie Mac, Georgia Dream NSP Program, HUD, Real Estate, VA
May 21, 2009 at 7:29 am |
This is an excellent program, now is the time to get your buyers engaged.
May 21, 2009 at 7:39 am |
does the buyer have to have a certain credit score?
Gale Watkins, Realtor
MetroBrokers/GMAC
678-409-0023 cell
May 21, 2009 at 2:13 pm |
See Lloyd’s answer below, 620 Credit Score, with some other requirements.
June 1, 2009 at 5:03 pm |
Yes a 620!
May 21, 2009 at 7:44 am |
It can never get better for Buyers at this time, “NOW IS THE TIME”!
May 21, 2009 at 7:47 am |
Applicants must have a 620 credit score and will be evaluated in accordance with normal FHA and VA underwriting requirements.
May 21, 2009 at 7:51 am |
Hello Lloyd, is this for investors too or is it just for owner occupied and not necessarily 1st time home buyers?
May 21, 2009 at 9:04 am |
Hi Regina,
This program is for primary residences only, but not limited to 1st time home buyers and the borrower can own other property as well.
May 21, 2009 at 9:40 am |
Ok, thanks!
May 21, 2009 at 8:17 am |
Now that really helps! Thanks for the info Judy. I have already forwarded it to a number of my buyers.
May 21, 2009 at 8:20 am |
The Man of La Mancha dreamed the impossible dream. I’m not certain what his dream emcompassed but for most Americans the dream is to own their own home and it is the POSSIBLE dream. There are so many tools out there to help homebuyers and the best tool of all is an informed, professional REALTOR. The REALTORS with the biggest tool boxes are Metro Brokers agents. Metro Brokers Financial and their informed, educated loan officers is always one of the best tools. Thanks for putting this out there for everyone, Judy.
May 21, 2009 at 8:39 am |
WOW! First the $8000 tax credit and now this new loan program…Buyers will be calling Metro Brokers agents left and right.
May 21, 2009 at 8:43 am |
THIS IS VERY COOL!!! Where might we find locations for the HUD approved classroom homebuyer education classes? Can anyone attend or are the classes limited only to those meeting the criteria of the Georgia Dream Homeownership Program? Thanks for this great link and postings…
May 21, 2009 at 10:00 am |
Hey Susan,
You can find a list of places to go for the homebuyer education classes here: http://www.dca.state.ga.us/housing/Homeownership/programs/downloads/HBed.pdf
I’m fairly certain that anyone can attend, and I highly encourage it…however since these programs are listed on the Ga Dept of Commumity Affairs website (www.dcaloans.com) for the NSP program, this will probably be harder to get into since all the NSP participants will just go here.
You can also look on the HUD site (www.hud.gov) to find approved homebuyer education agencies.
May 21, 2009 at 8:53 am |
The NSP product is NOT for first time homebuyers, but is for owner occupants. Remember that this loan is referred to as the NSP, and not the original GA Dream loan that advertises a rate of 6.75%.
The eight hour home buyer education classes fill up quickly — so get your buyers enrolled in that now!
May 21, 2009 at 8:53 am |
I have a client just completed her 8 hr mandatory home education training, and I’ve registered her for the FREE $14,000 down payment money. It can’t get easier or better than this. What are we waiting on!!
May 21, 2009 at 10:23 am |
I see Fulton is an approved county. Does this include the entire county or just selected neighborhoods?
May 21, 2009 at 10:54 am |
The entire county is eligible. However, the property must have been foreclosed upon and owned by either Fannie Mae, Freddie Mac, HUD, VA, another government entity, bank or non-profit REO. The following one-unit single family property types are eligible for this program:
*detached
*attached
*PUD
*condo
Manufactured homes are not eligible.
May 25, 2009 at 3:37 pm |
So Lloyd,
Any bank owned foreclosed property will qualify for this program? Even a new construction never occupied builder foreclosed home?
May 26, 2009 at 11:11 am |
Yes, even new construction, never occupied homes will qualify as long as they are owned by one of the above entities. Moreover, if the home lacks a CO (certificate of occupancy) and needs to be finished, the borrower can utilize the 203k FHA streamline rehab loan and roll in up to $35,000 in construction cost to complete the home.
May 21, 2009 at 10:44 am |
We also know that the certificates that the buyers receive from the education courses are good for 1 year. That is why it is important to get them registered ASAP for the home education training especially since classes fill up quickly. Agents, be sure that you include the DCA-NSP form 72 with the sales contact. Your Metro Brokers Financial loan officers can help you obtain this form if you do not have it.
May 21, 2009 at 10:58 am |
Down payment money… thats what our buyers need today… Down Payment Money. Thanks GA DREAM
May 21, 2009 at 11:22 am |
This is the best time to be in this business. Georgia Dream, NSP, Tax Credits. You name it we have it. We can truly be a one stop shop. The best way to proceed is to always get your clients Pre Qualified first and then we can help determine the best down payment option.
May 21, 2009 at 11:58 am |
This is great news! I have already sent it to 5 of my buyers.
May 21, 2009 at 1:21 pm |
Any suggestions for handling the 15% below value issue up front? I see a lot of problems with appraisals these days and you don’t usually have that until well after the contract is signed.
May 21, 2009 at 2:07 pm |
Most of the banks who own the foreclosed properties will already have a FMVA (fair market value appraisal) on the home and it may already be listed at or below the 15% mark. If there is no FMVA, then we can get our FHA appraiser to determine the fair market value for you.
May 21, 2009 at 2:22 pm |
Thank you for keeping us so updated!
May 21, 2009 at 2:57 pm |
Get Off The Fence in 2009! Don’t just dream about purchasing a home; make your dream a reality. Right now is the right time to “Get Off the Fence” Take advantage of all of this FREE money and programs to buy your first home! The door is open – act now before it closes. The Metro Brokers One Stop Shop can make it easier for you. I challenge you to make that call. The clock is ticking. http://www.wesellmetro.com.
May 21, 2009 at 9:34 pm |
Thanks for the information.
Another great homebuyer opportunity!
May 22, 2009 at 7:53 am |
Say it AGAIN! This is THE time to buy a home, no matter if you are a first time buyer or have bought many times before. Prices, Interest Rates, and Selection have never been this great. GO FOR IT NOW!
May 25, 2009 at 2:00 pm |
This is great for buyers. Will this information be included in the Tax Credit seminars?
May 26, 2009 at 8:57 am |
These are great programs and we need to spread the word to our SOI. “Now Is The Time ” before it is too late.
May 26, 2009 at 9:59 am |
What a great opportunity, this is a real blessing! Let’s take advantage of it, and make the American dream become a reality!
Que gran oportunidad, esta es una verdadera bendición! tomemos ventaja de esto y hagamos que el sueño Americano se haga realidad!
May 26, 2009 at 12:48 pm |
Question: Why are the lenders charging higher interest rates for customers that opt for the $14K GA Dream NSP program?
May 26, 2009 at 1:12 pm |
Wayne,
Lenders should not be charging higher rates to borrowers who are eligible for the $14,000 NSP funds. You may be thinking about the traditional Ga Dream Grant programs other than the NSP funds.
Unlike the traditional Ga Dream Grant programs which require the borrower to take a Ga Dream First Mortgage which is currently at a higher interest rate, the NSP Funds are used in conjunction with a FHA or VA First Mortgage.
May 27, 2009 at 9:26 am |
Where do I go to find out if a county is participating in this program?
May 27, 2009 at 3:06 pm |
Here is a link to the counties in Georgia which are eligible for the NSP funds
http://www.dca.state.ga.us/housing/Homeownership/programs/downloads/nsp_eligible_counties2009.pdf
May 28, 2009 at 5:20 pm |
Great news, everyone! You now have the convenience of receiving the
HUD approved 8 hour homebuyer education at our Atlanta location. I was able to schedule it for Wednesday, June 24th, from 8:30am-5:00pm in Building E-I!
There is no charge for this class. Reserve your seat today and bring your buyers with you! Seating is limited to 120.
RSVP to academy@metrobrokers.com. Enter in the subject line: “Georgia Dream & # attending”
May 30, 2009 at 12:35 am |
Can the Ga $1,800 tax credit be used along with the $14K grant?
May 30, 2009 at 10:33 pm |
I have a listing that is a resale by honest hardworking teachers in Gwinnett county that is immaculate and is already competing with foreclosure prices. Now buyers call and ask if it is a foreclsoure and even if the price is right and meets their criteria they are not interested because they won’t get $14k back from the government. How can a homeowner compete against that kind of “concession” besides the foreclosure price. How can this not erode prices even more. Isn’t giving people houses for nothing what got us here in the first place? Does anyone else see it this way? I’m sure the banks love it though. Cleans up their books.
June 1, 2009 at 2:11 pm |
I can relate! It hurts terribly when people have to sell for many thousands less than they paid few or many years ago. The situation may be part of the big picture market correction and will just take time to shake out. I am open for suggestions, too, but think our best approach is (as always) to be honest and educate our clients to what’s out there, processes, procedures, time-frames to close, etc., ask for longer listings and help our sellers see from the eyes of buyers today.
June 1, 2009 at 8:54 am |
what is NSP?
June 1, 2009 at 10:54 am |
I was just informed that NSP actually stands for National Stabilization Plan, which is a bill passed by Congress giving states funds to help stabilize the housing industry. It actually has nothing to do with The Georgia Dream Neighborhood Stabilization Program other than they are both handled by the Georgia Department of Community Affairs.
However, many people in our industry have elected to connect these programs together for a couple of reasons: 1) Some agents associate the Georgia Dream program with all government bond programs and/or 2) So many people use acronyms in our industry and both programs are sometimes referred to as NSP.
Sorry folks. Hope this clears things up. I believe our mortgage guru (Judy Jones) may be posting more details soon.
June 1, 2009 at 5:11 pm |
This program will help get the foreclosures off the market faster and help “stabilize” the area so that regular sellers can start selling again!
June 1, 2009 at 9:59 pm |
yes. true. I agree.
June 1, 2009 at 5:19 pm |
Could you get a house for FREE? By purchasing a Bank Owned property for for $14,000 using the NSP.
June 2, 2009 at 9:36 am |
Randy —
Brilliant thinking! But unfortunately no free homes. DCA says you MUST have a 1st mortgage to get the $14k 2nd mortgage. The $14k lives as a 2nd mortgage and is forgiven completely after 5 1/2 years, so free homes are not available. If that changes, I’ll get myself a free house first and contact you second.
June 2, 2009 at 7:39 am |
Question:
If a husband and wife will both be on the loan, do both have to take the The Georgia Dream Neighborhood Stabilization Program class?
I have been told yes AND no by the Georgia Department of Community Affairs.
What is the correct answer?
Does the Georgia Department of Community Affairs even know the correct answer?
June 2, 2009 at 7:57 am |
Good question Pete — and good point (does DCA even know the answer). Maybe / Maybe not – but my contact at DCA says that the all parties on the loan need a certificate stating completion of the NSP class — so I’d say yes — all parties should go. Plus, $14k for 8 hours — how can you argue that — better to take the class.
June 2, 2009 at 9:08 am |
NSP stands for National Stabilization Plan. This is actually name of the Bill which was passed by Congress for the Federal funds they allocated to the states to be used to help stabilize the housing economy.
This bill passed in mid March, so a fancy name was not given to the program….but NSP does not mean anything to Realtors or homebuyers, so the Mortgage Industry has “lumped” it in under the name Ga. Dream, which folks do associate with money for homebuyers.
NSP is not a Ga. Dream Program, and is in fact a better program as far as low interest rates and is a forgivable 2nd. But we call it Ga. Dream so that everyone gets the drift that it is money for homebuyers to use that the Government agency Ga. DCA (Ga. Department of Community Affairs) handles and distributes.
June 2, 2009 at 9:26 am |
To Leslie and Susan’s comments….I totally agree, but like Linda Kennedy points out, this program will help reduce the number of foreclosures which will help get us back to a market that focuses on properties offered by normal sellers.
However, I fear that many potential buyers are geting distracted with “possible” benefits and are losing site of what they have…
This market place is a perfect example of a “bird in the hand is better than 10 in the bush”!
Buyers who have now decided to look only at foreclosures in order to capture the $14,000 NSP money need to make sure they will really qualify for the other criteria of the NSP program.
The first step is to make sure the total household income is not too high for the HUD 110% median income.
The second step is to make sure the homebuyer is truly prepared for the challenges and realities of buying a foreclosure.
I hope buyers do not miss the opportunites that are out there waiting for MORE!
June 6, 2009 at 3:12 pm |
after repair and down payment, can the NSP money be used for closing cost too? and how long does the qualification process take ?
June 8, 2009 at 8:21 am |
As far as I can tell the Georgia Dream NSP program can not be used for closing costs.
The $8,000 tax credit CAN be used for closing costs (May 29,2009) follow this link for more details.
http://www.realtor.org/RMODaily.nsf/pages/News2009052901?OpenDocument
June 9, 2009 at 1:12 pm |
This program is dead in the water. There were only 350 loans for the entire state and the money is gone. DO NOT make plans based on trying to get this! Call some brokers and they will tell you the same
June 10, 2009 at 11:44 am |
What are the income limits for this program?
June 10, 2009 at 1:32 pm |
Free Money goes fast! As of today there is only $650,000 left in NSP funds for the entire state. At $14,000 per loan, that means there is only enough money left for 46 more loans, STATE WIDE.
Buyers who are expecting to close using these monies should have a fully executed sales contract and a confirmed reservation for the funds in their name made prior to today by their Mortgage Loan Officer.
Stay tuned for more updates. There is a very slim possibility that more funds will be released or unused funds will become availabe.
I would not wait to buy until these funds are available.
June 15, 2009 at 12:17 pm |
apparently my realtor believes this caused some of her clients to not get their offers accepted. Is listing GA Dream NSP a negative dpa to list on an offer? Is GA Dream dpa the kiss of death for an offer? Not getting clear answers right now? does anyone have any clear answers?
Also, if the NSP $$$ is about to run out, why I am even bothering with this?
July 20, 2009 at 11:18 am |
Anyone know if there are still funds available, or if this program is over?
Thanks!
July 20, 2009 at 12:55 pm |
Kevin,
All of the funds have been reserved. There are approxmately 120 buyers currently on a waiting list. There is a small possibility that some of these funds could become available if those buyers who have them reserved and those folks who are on the waiting list fall off.
Remember, in order to have a reservation and to be on the waiting list the buyer must have a fully accepted sales contract on an acceptable foreclosed property and have completed the total household income form.
With 120 buyers on the waiting list, I highly doubt that there will be excess funds made available as a result of fall out.
Remember, there is still time to buy and take advantage of the $8,000 Federal Tax Credit!
July 20, 2009 at 1:30 pm |
Thanks Judy, for taking the time to answer me!
July 22, 2009 at 10:28 pm |
I heard more funds are to be releasd to this program in July. Is this not true?
September 21, 2009 at 12:37 pm |
is the $14000 ga dream still available?
September 22, 2009 at 7:17 am |
These funds are totally used up or reserved waiting for buyers to close using the money they have reserved. There is also a waiting list of buyers in the event some of the buyers with reserved funds do not close.
The NSP funds phase 2 is money for Government entities to use to buy foreclosed properties in HUD designated area of “highest need” and then those homes will be made available by those Government entities to people who meet certain low to moderate income qualifications.
I am not aware of any future funding of the NSP program for 2009. Once new funding is announced for 2010, we will give those details on the blog.
November 19, 2009 at 8:41 pm |
So I have a client interested. Who is responsible for facilitating this program and when and how do they get the money? Is this for the lender to handle, me, a tax professional, or who? Thanks for your help.